A future without Ford – the new reality

By Kyle Rea
St. Thomas Times-Journal
As fallout continues from the news that Ford’s St. Thomas Assembly Plant will shut its doors in fall 2011, three of the biggest casualties locally — Southwold township, the Lear Seating plant and the Elgin-St. Thomas United Way — are taking a look at a future without the plant.
Last Friday, leaders of the Canadian Auto Workers union confirmed what has long been suspected, that the St. Thomas Ford facility will shut its doors in September, 2011, as the company looks to phase out production of the large cars manufactured there — the Crown Victoria, Lincoln Town Car and Grand Marquis. When that happens, 1,400 people will lose their jobs.

Ford turns up nose at unprecedented offer to save St. Thomas Assembly Plant

In a last-ditch effort to save the St. Thomas assembly plant, the province and Canadian Auto Workers made offers of cash and unprecedented concessions — but Ford Motor Co. said no.

The province offered as much as $150 million and the union told the company to cherry-pick details of any collective agreement and put it on the table, CAW national president Ken Lewenza said yesterday.

“(Ford of Canada vice-president) Joe Hendricks told me directly he could not get a better deal from any government than the one the Ontario government was prepared to put in front of Ford Motor Co. He was clear about that,” Lewenza said. “They were prepared to do more than any jurisdiction in the world. The Ontario government was prepared to be a major player.”

Instead, Ford will close the St. Thomas assembly plant in September 2011, cutting 1,600 jobs.

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80% of CAW Local 1520 membership vote in favour of new deal

TORONTO, Nov. 1 /PRNewswire/ – Thousands of CAW members working at Ford facilities in Oakville, Windsor, St. Thomas and Bramalea have voted in favour of a new agreement, ratifying the deal by 83 per cent during a series of meetings held over the past two days. The deal was reached on October 30 between the two sides.

“No one should mistake workers’ approval as satisfaction with the new agreement,” said CAW President Ken Lewenza. “Members had faith in the union to negotiate the best agreement possible and protect their interests over the long term, but the problems faced by industry cannot be resolved at the bargaining table.”

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A done deal – Ford to close St. Thomas plant in 2011, shed 1,400 jobs

MONTREAL — US automaker Ford Motor Co. will shutter one of its manufacturing plants in Canada in 2011, a move that will cut 1,400 jobs, the Canadian Auto Workers said Friday.

As part of a cost-reduction agreement between the company’s US headquarters and the CAW, the plant in St. Thomas will close in the third quarter of 2011, the powerful union said in a statement.

Some 1,400 employees will be dismissed, CAW spokeswoman Shannon Devine told AFP. Canadian media put the number of jobs eliminated at 1,600.

As part of the tentative agreement the union said it obtained a commitment by the US automaker to keep at least 10 percent of its North American production in Canada.
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St. Thomas Assembly Plant … “it is not looking good”

The future of the St. Thomas assembly plant was discussed yesterday and the automaker repeated there is no product for the local plant after 2011, Lewenza said.

The Crown Victoria, Mercury Grand Marquis and Lincoln Town Car are produced at the plant.

“We want St. Thomas to be extended, but that product line is being phased out. They have capacity all over the place. It is not looking good today.”

Ford did emphasize in talks yesterday it has made significant investments in Windsor, reopening an engine plant next year, and has added a fourth vehicle to its Oakville assembly plant.

“They indicated to us . . . Canada has been a key player in Ford’s success, but there is no product to allocate.”

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CAW won’t agree to strike ban in new Ford deal

Canadian Auto Workers president Ken Lewenza says Ford Canada shouldn’t expect the same concessions that Ford Motor Co. (NYSE:F) won in recent talks with its union in the United States including a ban on strikes over wages or benefits.

“Obviously we watched the U.S. negotiations closely with the UAW because of the competitive challenges we have from one country to the other,” Lewenza said in an interview Friday.

The CAW says Ford Canada intends to slash its Canadian manufacturing presence from 13 per cent to eight per cent of total North American production. Ford currently has no plans to build vehicles at its St. Thomas, Ont., plant beyond 2011.
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‘No role’ for government in Navistar labour dispute

WINDSOR, Ont. — Despite investing millions in Navistar’s Ontario operations, the provincial government won’t intervene in a labour dispute that has seen Navistar International shift production from Chatham to Mexico, Sandra Pupatello, minister of economic development and trade, said Wednesday.

“The Ontario government has no role to play in the discussions between workers and the employer,” Pupatello said after addressing an automotive outlook conference at Caesars Windsor. “What is important is that we’ve created an opportunity for there to be significant investment in the Chatham area and in the University of Windsor. Our investment is geared toward R&D — that is creating the next generation of products coming out of Navistar and in supporting training costs for employees in Chatham.”

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Ontario’s economy cannot prosper without a vigorous manufacturing sector

Formet Industries, St. Thomas

Posted by Ian:
Thanks to Serge Lavoie for the heads up on this positive look at this region’s manufacturing base. With plants and factories shuttered the length of South Edgeware and the Ford plant teetering, let’s hope that indeed the industrial engine is just idling.
So, here is the key question posed by the Toronto Star:

Without a revitalized manufacturing base, Ontario has little chance of a healthy economic recovery that delivers the good jobs and high productivity we need for sustainable prosperity.

So a key question as we face a federal election some time in the next 12 months is which party, Conservative or Liberal, can deliver the most effective manufacturing strategy for the province.
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Ford Canada’s labour costs highest in world

Hourly labour costs at Ford Motor Co. of Canada Ltd. (F-N6.84-0.13-1.87%) manufacturing operations are about $16 (U.S.) higher than similar costs at U.S. plants, sources close to the negotiations between the auto maker and the Canadian Auto Workers union said Friday.

Ford’s labour costs in Canada are higher than those anywhere else in the world, the sources said, meaning it’s difficult to make new investment commitments for its operations, such as the new products the CAW is seeking for a plant in St. Thomas, Ont., that is at the top of the endangered list.

“The hyper-competitive nature of this business globally means you just cannot be the highest-cost labour jurisdiction on the planet and expect those kinds of guarantees,” one source familiar with the discussions said.
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Ford/CAW talks at an impasse

Posted by Ian:
Drive along South Edgeware Road to get a first-hand look at the absolute economic devastation in St. Thomas, the result of the loss of up to 4,000 manufacturing and related jobs. Now with the pending closure of the St. Thomas Ford Assembly Plant in 2011, the fallout will be more than the 1,500 or so remaining jobs at the sprawling complex. Start with Lear, and the list of victims grows from there, as noted in this Globe and Mail story from Sept. 24/09 …

Closing the plant would be a serious blow to St. Thomas, which has already sustained the shutdown of a Sterling truck factory by Daimler AG, said Scott Smith, unit chair of CAW local 1520, which represents workers at the Ford plant.

If the Ford plant closes, suppliers are also likely to close, Mr. Smith noted, pointing to Lear Corp., which is operating in Chapter 11 bankruptcy protection and has a plant in St. Thomas that supplies seats to the Ford plant.

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Ford says it has no plans to manufacture vehicles at the St. Thomas plant beyond 2011.

Ford Canada spokeswoman Lauren More confirmed Tuesday that the company has no plans to manufacture vehicles at its St. Thomas, Ont., plant beyond 2011. The plant has been in operation since 1967.

Currently, the 1,600-employee plant manufactures the Ford Crown Victoria, the Lincoln Town Car and the Mercury Grand Marquis – all full-sized cars, demand for which is limited to niche markets. In fact, the Crown Victoria is only sold as a part of fleets, such as police cars and taxis.
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Ford to drop police car production at St. Thomas plant

DEARBORN, Mich., Aug. 28 (UPI) — U.S. auto giant Ford Motor Co. said Friday it would close out production of the Crown Victoria police car from an Ontario, Canada, plant in 2011.

Ford told members of the Canadian Auto union it had no replacement planned for the Crown Victoria, the Detroit Free Press reported Friday.

The St. Thomas Assembly Plant in Ontario also produces Mercury Grand Marquis and Lincoln Town Car models.

Ford spokesman Robert Parker declined to elaborate on the company’s plans for the popular police vehicle. “We expect our plans to be firmed up by the end of the year,” he said.

But Parker said building police cars “is not a business we take lightly.”

“The company is committed to it,” he said.

In the first half of 2009, Crown Victoria sales dropped 30.9 percent to 21,949 compared to the same period of 2008. Ford stopped selling the model to the public in 2007.

Ford did not confirm rumors it would replace the Crown Victoria with a police car based on the Taurus, the newspaper said.

Lear Prohibited From Tapping Canadian Plants for Cash

July 9 (Bloomberg) — Lear Corp., which filed for bankruptcy in the U.S. on July 7, was prohibited by a judge from tapping its Canadian plants for cash.

Lear, the world’s second-largest maker of automobile seats, owed its Canadian units about $82 million as of May 31, according to a report from the accounting firm RSM Richter, which was appointed information officer by the judge.

Lear’s Canadian operations “shall not make advances or transfers of funds to any of the applicants or any of their affiliates by way of loan or otherwise,” Ontario Superior Court Judge Sarah Pepall said in an order issued today that recognizes the U.S. bankruptcy proceedings. She made an exception for payments due in the ordinary course of business.

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